Yes, It Was Illegal To Charge Nursery Fees During Coronavirus Lockdown, Says Watchdog

Could you be due some money back if you had to pay nursery fees to ‘save your place’ during lockdown?

Updated on29 07 2020

Nurseries who threatened that children would lose their childcare place if they didn’t pay fees during lockdown acted ‘illegally’ says the Competition and Markets Authority (CMA).

The regulator found that childcare providers pressured parents into making payments while they were shut to keep the place, or said that otherwise they’d go out of business. Others made parents pay ‘unfair’ cancellation fees.

Nurseries were forced to close in March, apart from for the children of key workers. But debate raged on WhatsApps groups across the country, with some nurseries stopping payment, some asking for a small contribution to stay open and other demanding full fees – numbering over £1,000 a month.

Consumer group director of the CMA Gordon Ashworth said: ‘Our investigation found that, whilst the vast majority of providers were striving to reach fair arrangements with consumers in very challenging circumstances, there remained concerns that some were treating consumers unfairly.

The watchdog added that ‘it is likely to be an unfair and illegal’ practice to threaten families with losing their place if they didn’t pay fees.

‘Despite the financial pressures caused by the crisis, providers should not demand that consumers should pay high fees by warning that if they do not pay the fees the business will cease trading and/or livelihoods will be lost,’ they said. ‘To do so may breach consumer law.

‘Contract terms requiring consumers to pay providers who are not providing the services agreed in the contract are likely to be unfair and unenforceable.’

The group did, however, have not said it will take enforcement actions. Though it warned nurseries that parents could still take legal action over breaches of contract.

Neil Leitch, Chief Executive of the Early Years Alliance told The Telegraph the government should’ve prevented the situation from arising.

‘No provider should have ever been put in a position where they were forced to ask parents for the financial support they should have been getting from the Government,’ he said.